Manufacturing Project Portfolio & Capex worked example

Project NPV at 90% discount adjustment: a worked example

This scenario runs the project npv calculation on the strong side: 90% discount adjustment, with every other input held at its documented default. A finance partner running a fast NPV screen on a capital project before a full discounted-cash-flow model.

The inputs for this scenario

  • Cash flow periods: 7 years (unchanged)
  • Annual net cash flow: 95,000 $/year (unchanged)
  • Discount adjustment: 90 % (raised for this scenario; the documented default is 78)
  • Initial capital outlay: -350,000 $ (unchanged)

Working through the calculation

  • Applying the documented formula (Project NPV = cash flow periods x annual net cash flow x discount adjustment + initial outlay) to the inputs above produces each figure below.
  • At this operating point the engine returns 598,500 $ for total project npv cost, the number this scenario is built around.
  • At this operating point the engine returns 85,500 $ / piece for project npv cost per unit.
  • At this operating point the engine returns 598,500 $ for variable project npv cost.
  • At this operating point the engine returns 0 $ for fixed project npv adder.

How this compares with the baseline

  • Against the tool's baseline example, where discount adjustment sits at 78% and the headline result is 518,700 $, this scenario comes in 15.38% above the baseline at 598,500 $.
  • Use it to screen and rank capex proposals — new lines, retrofits, automation — before committing capital. Treat this as a target state: the delta against the baseline quantifies what the improvement is worth before you commit to chasing it.

Results at a glance

  • Total project npv cost: 598,500 $ (headline result)
  • Project npv cost per unit: 85,500 $ / piece
  • Variable project npv cost: 598,500 $
  • Fixed project npv adder: 0 $

Run it with your numbers

  • Every input above is editable in the live Project NPV calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.